Wills and Estate Planning
A will is a document that provides your instructions for the distribution of your assets after your death and only takes effect after you die.
It is important that you make a will to ensure that whatever assets and personal belongings you have go to the family members, friends, and charities who you want, not what the government dictates. If you die without a will (this is called “intestate”), the laws in Ontario dictate who in your family gets your assets and in what proportions. For example, if you die without a will and leave a spouse and children, your spouse does not get everything. Your spouse will only get the first $200,000 of the value of your estate and the rest will be shared among your children (even if they are minors), subject to other claims a spouse may make under the Family Law Act or dependant’s relief legislation. Also, the administration of your estate will involve a longer and more complicated process than if you had a will – your surviving spouse or heir to your estate will need to hire a lawyer and make an application to the court to be able to administer your estate.
Some of the benefits to having a will are:
- You can choose a person who you trust to be the executor of your will (i.e.,the person who will administer your estate after you die)
- You can choose who you want to be the beneficiaries of your estate and in what proportions and choose alternate beneficiaries in the event that your primary beneficiaries pre-decease you, die in a common accident with you , or die before they receive the full amount of a trust you set up for them in your will
- You can create trusts for children and grandchildren that defer inheritances beyond the age of 18 but provides money for support and educational expenses
- You can provide instructions to your executor as to who gets specific items such as art and jewelry.
- You can provide fairly for a second spouse, common-law spouse, and children from a first marriage
- You can make a tax-deductible gift to your favourite cause or charity
- You can create a trust for a disabled beneficiary who receives ODSP benefits so that receiving an inheritance from your estate does not disentitle them from their ODSP benefits
- You can name guardians for dependants
- You can create primary and secondary wills to deal with assets that are subject to estate administration tax in one will and assets that are not subject to this tax in the other will
- It usually results in your estate being administered after your death much more quickly and inexpensively than if you died without a will